An Early Reaction To Tiffany's Q2 Beat-And-Raise

Tiffany & Co. TIF reported second-quarter results early Tuesday that were highlighted by top- and bottom-line beats. The CEO of Telsey Advisory Group shared their early reaction on CNBC. 

The Analyst

Telsey Advisory Group CEO Dana Telsey discussed Tiffany's stock on CNBC.

Telsey: Tiffany Remains 'Relevant'

Tiffany's stock has upside to at least $150 per share, and the path to get there is being followed by the luxury retailer's management, Telsey said Tuesday morning during CNBC's "Street Signs" segment.

Tiffany continues to improve the product line while enhancing stores to give consumers a better shopping experience, the CEO said. The company is focusing on modernizing its marketing message, she said: the recent "Believe In Love" campaign in the first quarter helped generate an 11-percent year-over-year increase in engagement sales.

Tiffany only needs to stay the course and continue innovating through new projects, the most notable of which is the multiyear renovation of its 10-floor flagship store on Fifth Avenue, Telsey said during a separate "Squawk Box" segment. The company's continued investments extend beyond a facelift at stores and includes upgrades to its CRM system, she said. 

As long as Tiffany drives growth and reports upside to Street estimates, the retailer gets a pass from the investment community to invest heavily in its business, Telsey said. This was the case with Tuesday's earnings report, where the company not only delivered a same-store sales beat in the Americas and Japan, but posted above-consensus gross margin as well.  

Tiffany highlighted strong sales from local customers as opposed to tourists, which is a bullish indication, as a potential pop in tourism would drive growth even higher than expected, Telsey said.

Price Action

Tiffanys hares were trading nearly 6 percent higher at $129.78 premarket Tuesday.

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